The launch of TerraUSD (UST) supports LUNA’s rise to a new all-time high

Stablecoins are an integral part of the centralized cryptocurrency sector and decentralized financial ecosystems (DeFi) which have emerged in recent years as they provide traders with the liquidity they need to easily switch to various assets. They also serve as a refuge from strong downward vibrations, like the 25% correction observed on December 3rd.

One project with a stablecoin component, the price of which has risen to a new all-time high despite the broader market decline, is Terra (LUNA). a multi-sector blockchain protocol that aims to build a global payments system using a fiat parity stablecoin called TerraUSD (UST).

Data from Cointelegraph Markets Pro and TradingView show that Since hitting a low of $ 37.86 on November 26, LUNA has soared 106% to a new all-time high of $ 78.43 on December 5th, while the 24-hour trading volume hit a record $ 5.66 billion.

4-hour chart for the LUNA / USDT pair. Source: TradingView
The launch of TerraUSD (UST) supports LUNA’s rise to a new all-time high
The launch of TerraUSD (UST) supports LUNA’s rise to a new all-time high

The three reasons for LUNA’s price increase are the increase in the supply of UST, a number of new cross-chain integrations for the Terra ecosystem and an increase in Total Value Locked (TVL) on the Terra network.

UST bid reaches new all-time high

One of the main reasons for the strength observed at LUNA was the rapid growth of UST’s excellent offering, This is now the largest algorithm-driven stablecoin in the market and the fourth-placed stablecoin overall with a market cap of $ 8.221 billion.

Cryptocurrency proponents who advocate decentralized stablecoin options have embraced the use of UST as compared to its more centralized counterparts. USD Coin (USDC), Tether (USDT) and Binance USD (BUSD).

As UST grew in popularity, many in the industry began to refer to it as “The DeFi Dollar”. because it embodies the ethos of decentralization and is slowly spreading in the cross-chain DeFi landscape.

Cross-chain integrations

LUNA is also available through some cross-chain bridges, making it easier for LUNA holders to invest their DeFi ecosystems in Ethereum (ETH), Solana (SOL), Fantom (FTM) and Polygon (MATIC).

The total value locked in Terra hits an all-time high

The increased use of LUNA and UST resulted in the total value of the Terra blockchain reaching a new all-time high of $ 14.36 billion. on December 5th, and LUNA’s course hit a record on the same day.

Total value blocked in the Terra network. Source: Defi Lama

TVL’s rapid rise has made Terra the third blockchain network in terms of TVL, after overtaking Solana, which was valued at $ 12.08 billion on its protocol. while the Ethereum network, which occupies the first position, has a TVL of $ 164,720 million and the Binance Smart Chain is valued at $ 22,400 million on its blockchain.

Cointelegraph Markets Pro’s VORTECS data highlighted a bullish outlook for LUNA on November 24th., before the recent price increase.

The VORTECSâ ?? ¢ Score, exclusive to Cointelegraph, is an algorithmic comparison of historical and current market conditions, derived from a combination of data points This includes market sentiment, trading volume, recent price movements, and Twitter activity.

VORTECSâ ?? ¢ Score (green) against CHZ. Source: Cointelegraph Markets Pro

As can be seen in the graphic above, The VORTECS score for LUNA began to rebound on November 24th, hitting a high of about 85, while the price began to climb 106% over the next eleven days.

The views and opinions expressed are those of the author only and do not necessarily reflect the views of Cointelegraph.com. Every investment and every course of business carries risks, so you should do your own research when making your decision.

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